29 May 2008

Microsoft and Intel's much-feared "Trusted Computing" initiative seems to not have gotten off the ground, but smaller-scale efforts have become much more common in the last few years. Manufacturers can now regulate after-market behavior with chips and cryptography, which can create much more specific and onerous burdens than the old tools: licenses, contracts, and mechanical design. These restrictions are making their way into music, videos, phones, printers, cars, you name it.

In a 2002 New York Times column, economist Hal Varian argued that these techniques cause prices to go up in uncompetitive markets. But, more insidiously, they stifle innovation, as demonstrated by the following example (among others). In an effort to make more money selling ink cartridge, some printer manufactuerers have added chips to ink cartridges preventing operation if the cartridge has been refilled by a third party.

A hot area of computer-chip research design involves taking off-the-shelf inkjet printers, loading the cartridges with magnetic ink and squirting integrated circuits onto metalized plastic. That technology may revolutionize integrated circuit production — but it definitely requires using products in ways the manufacturer didn't intend.

[...]

That sort of thing will be simply impossible if digital rights management becomes commonplace.

These measures create many roadblocks for experimentation. The real shame is that by doing so they make innovation a lot less attractive for all but the most powerful people and organizations, those who can pay their way around such restrictions before even starting. Total control of inventions by their manufacturers may be the death knell for the legend of the inventor in the garage.

I just finished
reading Banker
to the Poor by Muhammad Yunus. He tells the story of how he founded
Grameen Bank (roughly translated, "village bank"), which makes small loans to
the poor without requiring collateral. (This is known as microcredit
and loans are typically less than USD $100.) As a result of loans from
Grameen Bank and similar organizations in other countries, tens of millions
of families have escaped poverty for good.

In Yunus's native country of Bangladesh, many poor people were virtually in
a state of slavery because, just in order to acquire raw materials for their
craft or seeds for planting, they were forced to take out loans at shockingly
high interest rates. The moneylenders effectly captured all the profit,
making it impossible for the borrowers to escape poverty. Grameen Bank has
empowered its borrowers by lending them just enough to allow them to break
out of this cycle. In fact, most borrowers are women who had previously been
entrusted with little or no financial responsibility. Borrowers quickly
become financially self-sufficient; most are able to expand their
enterprises, taking out larger and larger loans each year.

Part of Grameen's signature is that it requires prospective borrowers to
form small groups. Group members help each other stay focused and provide
insurance when calamity strikes.

Grameen Bank's success has been remarkable. The repayment rate tops
98%. The poor are so desperate, Yunus says, that given this one chance to
pull themselves up, they are just not going to let it slip away.

The mindset behind this program runs completely counter to prevailing wisdom
in the United States. In the US, we assume that to make poor people
self-sufficient we need to give them training or an education, so that they
can get a wage-paying job. Meanwhile, anyone who starts a venture needs huge
amounts of capital, enough that we need to keep them on a leash by telling
them how to run their business. So it is, to me, unsurprising that Grameen
Bank's idea— providing small loans and advising, but not managing,
borrowers— started not in the US but in a country like Bangladesh,
where most people are self-employed. But the success of microcredit even in
prosperous nations such as the US shows that the entrepreneurial spirit is
common, and not just in Bangladesh.

Banker to the Poor is not just the story of Grameen Bank but also a
critique of mainstream economic thinking and institutions. Yunus objects that
even though the standard economic axioms promise certain kinds of global maxima, the
objectives that are maximized are deeply flawed. Why should we consider
increases in total production or wealth to be important if it is entirely
possible (or indeed, common) that most of the prosperity is seen by the
richest few? According to Yunus, it is this misguided focus that has
distracted us from the things that could actually help us eliminate
poverty.

Yunus believes that with self-sustaining institutions like Grameen Bank
which are chartered to help the poor, we could relegate poverty to the
history books. Coming from most people, this would be idealistic fluff. But
on the strength of Grameen Bank's success, I am ready to take Yunus's word
for it.

Yunus tells a great story, and I am well on my way into his next
book, Creating a World Without Poverty.

11 May 2008

Speed Racer may very well give your brain diabetes, and I state that as compliment.

The plot is pretty predictable (evil megalomaniac with henchmen, unlikely alliance of good guys, various plot twists) but fairly well done, and the characters are enjoyable to watch.

The visuals, however, are stunning. From the studio logos all the way through the closing credits, Speed Racer contains contains gratuitous amounts of color and motion. It's gripping and fluid and, yes, beautiful. The Wachowskis have apparently figured out exactly how to turn on the pleasure centers in human brains, which is pretty remarkable. What more could you ask for from a movie?

Disclosure

I'm a software engineer at DNAnexus, Inc. This blog represents the opinion of myself and no one else.Unless specifically noted otherwise, I do not receive free review copies of books or other products mentioned here.